Record £516m profit for scan­dal-hit car scheme for dis­abled

MOTABILITY yes­ter­day re­vealed record prof­its – on the day it was ex­posed for over­charg­ing dis­abled cus­tomers while hoard­ing bil­lions of pounds.

The tax­payer-funded char­i­ta­ble car scheme’s an­nual re­port shows it made a ‘spare’ £516mil­lion last year.

Chief ex­ec­u­tive Mike Betts is al­ready quit­ting in dis­grace af­ter the Mail in­ves­ti­gated his £1.7mil­lion pay and an of­fi­cial re­port by au­di­tors con­cluded his firm was over­charg­ing the dis­abled by £390mil­lion.

The com­pany pub­lished its 2018 an­nual re­port which shows it is mak­ing more cash than ever – with ev­ery penny com­ing from the pub­lic purse.

The fig­ures show that Motability, which leases cars to wheel­chair users and oth­ers in exchange for their state mo­bil­ity ben­e­fits, dou­bled its prof­its in 2017-2018. The firm is sup­pos­edly ‘non-profit’ so any money it makes from the dis­abled, and from sales of sec­ond­hand cars, is usu­ally added to its ‘re­serves’ – cur­rently stand­ing at £2.5bil­lion.

In re­sponse to a Mail in­ves­ti­ga­tion ear­lier this year, the com­pany scram­bled to off­load its prof­its by mak­ing a £400mil­lion do­na­tion to Motability’s char­i­ta­ble arm.

The sum was so vast – 14 times the char­ity’s an­nual bud­get – that it will strug­gle to ab­sorb it, the Na­tional Au­dit Of­fice’s re­port said.

Af­ter mak­ing this do­na­tion, just be­fore the end of its fi­nan­cial year in Septem­ber, Motability Op­er­a­tions went on to record a post-tax profit of £116mil­lion.

Taken to­gether, it means the amount of money that went un­spent, be­fore the last­minute do­na­tion, was £516mil­lion – a record profit for the char­i­ta­ble or­gan­i­sa­tion. The pre­vi­ous year’s profit was £217mil­lion.

If this half a bil­lion pounds was re­turned to the tax­payer, rather than be­ing kept within the Motability scheme, it could pay for 15 new schools or the salaries of 22,000 teach­ers.

Last night Labour MP John Mann, a mem­ber of the Com­mons Trea­sury com­mit­tee, said: ‘This truly is a com­pany with no shame. It beg­gars be­lief that on the very day they are ex­posed for over­charg­ing vul­ner­a­ble peo­ple with dis­abil­i­ties and pay­ing the top boss a tele­phone-num­ber salary, they re­veal record prof­its.

‘This money should be go­ing straight back to the Trea­sury to be put to good use.’ Motability’s shamed chief ex­ec­u­tive fell on his sword on Thurs­day, on the eve of a damn­ing of­fi­cial in­quiry by the Na­tional Au­dit Of­fice trig­gered by the Mail’s in­ves­ti­ga­tion.

But there was fresh anger when it emerged Mr Betts could cling to his post for up to 17 months until a suc­ces­sor is found, po­ten­tially earn­ing hun­dreds of thou­sands of pounds more.

The NAO re­port con­demned lev­els of ex­ec­u­tive pay at Motability and its ‘un­nec­es­sar­ily’ large pile of re­serve money. It found the firm had racked up a whop­ping £1.05bil­lion in ‘un­planned prof­its’.

Foren­sic ac­coun­tants also dis­cov­ered a bonus worth £2.2mil­lion due to Mr Betts which had been hushed up in pre­vi­ous years’ ac­counts.

In his state­ment to Motability’s an­nual re­port, Mr Betts said: ‘We are proud of the ser­vice we pro­vide. Meeting the needs of cus­tomers is our ma­jor fo­cus.’